IB skill practice

Compare decision tree expected values

Calculate branch expected values and identify the better decision.

Paper 1, Paper 2 5 marks Difficulty 5

Compare decision tree expected values - exam decision

A retail demand model decision branch has probability 0.49 of payoff 110 and probability 0.51 of payoff 28. Calculate the branch expected value. Confirm the interpretation before entering the result. Enter the requested value and choose the interpretation that matches the result.

Worked practice: result and interpretation

Calculate the requested result first, then choose the interpretation that follows from it.